New York (AFP) – Nike reported lower profits on another drop in revenue Thursday, with new CEO Elliott Hill vowing to get the slumping sports giant back on track. The athletics company, which has struggled in recent quarters with weakness in China and product oversupply that has depressed prices, reported quarterly profits of $1.2 billion, down 26 percent from the year-ago period. Revenues dropped eight percent to $12.4 billion, with sales falling in all four geographic divisions.
Besides product oversupply and criticism of a lackluster product pipeline, Nike’s results have suffered from negative effects from its efforts to boost direct selling to consumers. Those steps reduced exposure to wholesale channels, creating openings for smaller companies to take market share. Hill described his first two months as CEO as “energizing,” after rejoining Nike in October. He has moved to clear out excess inventory, reignite innovation and pursue “big bold marketing” in line with the company’s buzzy tradition.
“We’re repositioning the business to get back to driving a pull market for Nike,” Hill said, telling analysts he sees his mission as taking the company “to someplace new.” A self-described Nike “lifer” who first joined the company as an intern, Hill retired from the sports giant in 2020. At the time, he had served as president of the consumer and marketplace division, responsible for all commercial and marketing operations for Nike and Jordan brands.
Shares of Nike rose 0.8 percent in after-hours trading.
© 2024 AFP
